Casino legislation on the fast track

Legislation to legalize casinos — which lawmakers in Prime Minister Shinzo Abe’s ruling coalition seek to ram through the Diet by the middle of next week — will add to the contradiction in this country in which gambling is prohibited under the Criminal Code but an estimated 5 million people are suspected of being gambling addicts. This situation is permitted by special laws that provide for publicly run forms of wagering such as horse racing as well as the thriving pachinko industry that is effectively nothing but gambling. The Abe administration touts the introduction of casinos as a key feature of its growth strategy to draw more inbound tourists and generate jobs, but various concerns about its potential problems are being cast aside as the bill gets railroaded through the Diet with minimal deliberation.

The bill is formally called legislation to promote development of integrated resorts — which combine hotels, convention centers, shopping malls and casinos, and other facilities. It requires the government to craft necessary legal steps within a year to pave the way for creation of such facilities, presumably including additional legislation that will set regulations on the operation of casinos and a mechanism for government supervision of the private-sector firms that will run them.

Proponents of legalizing casinos say they will provide a big boost to the nation’s tourism industry, particularly the fast-growing numbers of visitors from overseas, which will create jobs and add tax revenues to national and local government coffers. Several prefectures and municipalities across the country, including Osaka Prefecture and the city of Yokohama, are eager to get casinos in hopes of boosting their local economies. But while the economic benefits of casinos draw the limelight, little public discussion has been held about the potential problems — including the risk of involvement by organized crime and possibly exacerbating the problem of gambling addiction in this country — and whether the anticipated benefits outweigh the potential social costs.

Gambling is banned under the Criminal Code, but a series of special laws provides for exceptions, such as the publicly run horse racing and motorboat racing as well as lotteries. You see pachinko parlors everywhere — which under the law are categorized as “game” businesses — with an estimated market size of nearly ¥19 trillion. The Health, Labor and Welfare Ministry in 2014 estimated that 5.36 million people in Japan — or about 5 percent of the adult population — are suspected gambling addicts whose worst symptoms include incurring heavy debts as well as loss of job and family.

Will legalizing casinos exacerbate the gambling addiction? Some think so, others disagree and yet others say introducing legal gambling with proper government supervision will help ease the problem. Ideas were floated earlier to restrict entry to casinos, for example, to nonresidents in the initial phase to prevent their introduction from adding to people’s gambling addiction. The problem is that none of these questions were properly addressed as the legislation is being pushed through the Diet.

Since it was proposed by a group of lawmakers from the Liberal Democratic Party and part of the opposition camp in late 2013, the bill was barely deliberated in the Diet — it was scrapped when Abe dissolved the Lower House in late 2014, resubmitted last year and has been carried over without being discussed. The momentum for pushing the legislation through the Diet suddenly built up when the term of the current extraordinary session was extended late last month through Dec. 14. Deliberation of the bill began Nov. 30 at a Lower House committee, which passed it in three days after discussing it for a total of six hours. It was pushed through the Lower House in a plenary session vote Tuesday and the LDP is seeking to put it to an Upper House vote by next Wednesday.

The way the legislation was hurriedly rammed through the Lower House left even some lawmakers in Abe’s ruling coalition unhappy. Komeito, the LDP’s junior coalition partner which had called for caution about legalizing casinos, let its Lower House members decide for themselves how to vote. On Tuesday, 22 of the 33 Komeito members present voted in favor and 11 voted against — including the party’s secretary-general and Diet affairs chief. Among LDP lawmakers, former Defense Minister Gen Nakatani left the chamber when the vote was taken — later explaining that the legislation does not provide for enough measures to address gambling addiction.

The Lower House passed a supplementary resolution calling for beefed-up measures against gambling addiction when it voted for the casino legislation. But it left it up to the government to take those steps — presumably in the additional legal measures it will be preparing later. There may be pros and cons about legalizing casinos, but at least the way the legislation is being pushed through the Diet does little to assure it will be a safe bet.